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Autoliv Starts Production in Korea

8 November 2000

Autoliv Starts Production in Korea

    STOCKHOLM, Sweden, Nov. 8 Autoliv Inc. -- the
worldwide leader in automotive safety systems -- has established an agreement
to form a joint venture with the leading Korean auto parts supplier Mando
Corporation.
    Korea is the only major car producing country where the Swedish-American
safety supplier has not had manufacturing of its own.  Instead, the Autoliv
products sold in Korea have been exported from the United States, Australia
and Germany, or produced locally by Mando and other licensees.
    The new joint venture, Autoliv Mando Corporation, in which Autoliv will
have 65% of the shares, is expected to reach an annual sales in a few years'
time of approximately $200 million, almost 5% of Autoliv's current sales.
    Korea is the world's fifth largest car-producing nation in the world.
This year, the country is expected to produce more than three million
vehicles, with Hyundai being the largest producer, followed by KIA, Daewoo,
Ssangyong and Samsung.  All the companies are Autoliv or Mando customers.
    The new joint venture is expected to have approximately 35% of the Korean
market for seat belts, airbags and other safety related products.  Currently,
Autoliv's export sales to Korea amount to approximately $100 million, while
the combined sales of its Korean licensees total approximately $50 million.
    At the start, sales from Autoliv Mando Corporation will only include
Mando's sales of airbags licensed from Autoliv, and therefore amount to just
over $30 million.  But over the next five years, approximately $200 million in
annual sales will be reached as the main portion of new con tracts that
Autoliv has secured in Korea will be transferred to the new Company.
    "Autoliv alone has now secured supply contracts with an estimated sales of
over $150 million in Korea, in addition to the business through our licensees.
At the same time, we see a rapid recovery in the country's car production
after the Asian Crises in 1998.  This is therefore the right time to set up
local production", declared Autoliv's President and CEO Lars Westerberg.
    "With the new company we should be able to offer the Korean car
manufacturers smart airbag systems, rollover protection systems and other
advanced technologies and designs in automotive safety that we have developed
recently as a result of our extensive research and development in Europe and
the United States.  Consequently, we will become an even better partner for
the Korean car manufacturers and other vehicle manufacturers with operations
in Korea or with plans to establish operations there", Lars Westerberg
concluded.
    The new company will have its headquarter and production facility in the
Seoul area.  Operations are expected to start early next year.